If you have store card debt that you cannot manage in these hard times it may be the right moment to see if you can deal with it via debt management. Store card debt is a very expensive way to take on credit to pay for goods. Store cards are very often pushed in store as a way of generating sales commission for staff. These store cards are often made to look enticing by combining the taking of the store card with a “free gift” or discount. In reality unless you clear the store card of the credit put on it at once you will end up paying interest on your purchases in excess of 30%.

Here at Help With Debt we take calls from some of the people who hold the estimated 2 million store cards. They are often struggling to meet the monthly commitments on these cards, due to the high interest rates charged.

One of our solutions to this type of debt is debt management. This is a simple and effective method for combining all your debt from store cards and credit cards and loans, and then paying one simple monthly payment via a debt management company to all your creditors.

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The Individual Voluntary Arrangement, otherwise shortened to the IVA is a very popular method for people in England and Wales to deal with debt problems arising from the use of store card debt. This year about 40,000 people will seek to enter an IVA. Many of these will have store card debt among the various debts that they are seeking to deal with.

It can seem very tempting to take up the offer of a store card for a significant purchase. When in store the sales staff are very keen to get you to take up their cards and so you will find them coupled with a free gift or a discount. This is because the commission earned by the staff is very lucrative to them, and the profits earned by the store on the commission can be huge.

In the UK interest rates are currently at 0.5% (Nov 2009). Interest rates on store cards are at 30% plus. It is one of the most expensive forms of borrowing you can now take out. It is a great idea if you can take a card and get 20% off your purchase, use six weeks interest free before making a payment to clear in full. The store bank on the evidence of usage that they have accumulated that you will not.

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How to Deal With Store Card Debt

Britain’s shoppers are addicted to store cards. Some 11 million of these have been issued or are in circulation at the present time. Store cards are pushed very hard by the stores because they attract loyalty and they generate huge revenue. Up to 2 billion may be outstanding and owing on store cards at any one time. Take advantage of our free store card debt helpline if you have store card debt you cannot pay off.

Expensive

The store card is a branded credit option provided by some of the high streets biggest names, but this form of borrowing is very expensive indeed. At the time of writing interest rates are at an all time low of 0.5%. Even if you are coming to this later and rates have changed, they will never be close to the 30% plus rate of interest that store cards charge.

Advantages

This list is small for a reason. They are not good value. Ok if you are the type of person who can clear the card in full at the end of the interest free period they are ok to use. The percentage of people that use a store card and do not pay interest is very small.

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